Sorrento Pavilion, LLC et al. v. East West Bank et al. CASE NO. 112CV233122
DATE: 18 April 2014 TIME: 9:00 LINE NUMBER: 10
This matter will be heard by the Honorable Judge Socrates Peter Manoukian in Department 19 in the Old Courthouse, 2nd Floor, 161 North First Street, San Jose. Any party opposing the tentative ruling must call Department 19 at 408.808.6856 and the opposing party no later than 4:00 PM Thursday 17 April 2014. Please specify the issue to be contested when calling the Court and counsel.

On 18 April 2014, the motions of plaintiffs Sorrento Pavilion, LLC (“Sorrento”), Teri Nguyen (“Teri”) and Vince Nguyen (“Vince”) (collectively, “Plaintiffs”) (1) to compel the in camera inspection and production of documents, to compel the production of a privilege log, and to preclude defendants East West Bank (“EWB”), John Chen (“Chen”), Betty Liaw (“Liaw”), and East West Investment, Inc. (collectively, “Defendants”) from disseminating private medical information, (2) to file exhibit H attached to Plaintiffs’ counsel’s declaration (“Exhibit H”) under seal, and (3) to file exhibit I attached to Defendants’ counsel’s declaration (“Exhibit I”) were argued and submitted. Defendants filed formal oppositions to the first two motions. No opposition was filed to the third motion.

The same day, the motions of Defendants (1) for an order sustaining objections to written deposition questions, (2) to compel the independent mental examination (“IME”) of Teri and Vince, and (3) to file Exhibit I under seal were argued and submitted. Plaintiffs filed formal oppositions to the first two motions. No opposition was filed to the third motion.

All parties are reminded that all papers must comply with CRC, rule 3.1110(f).

Statement of Facts

This is a wrongful foreclosure action. In the second amended complaint (“SAC”), Plaintiffs allege the following: Teri and Vince are the sole members of Sorrento, which owned real property (“Property”) in San Jose beginning in 2004. Sorrento obtained a loan to finance construction on the Property. Pursuant to Liaw’s advice, Sorrento refinanced its loan by obtaining a $4 million loan (“Refinance Loan”) from EWB, secured by a deed of trust on the Property. Sorrento then obtained a second loan and sought a third from EWB.

Based on Liaw’s representations, Sorrento withheld payment on the Refinance Loan pending approval of the third loan, believing it was EWB’s policy to allow it to do so without defaulting. EWB sent foreclosure notices to Plaintiffs in June 2009, then orally agreed to issue the third loan and use those funds to repay Sorrento’s missed payments on the Refinance Loan. Defendant Syufy Enterprises, LP (“Syufy”)—the sole member of defendant First Century (“First Century”)—owns a theater adjacent to the Property. Syufy and defendant SyWest Development, LLC (“SyWest”) have a strong interest in purchasing the Property, and Sorrento has twice refused to sell it to them. Unbeknownst to Plaintiffs, EWB secretly negotiated the sale of its interest in the Refinance Loan to Sywest, and then, in September 2009, sold its interest to SyWest. SyWest assigned its interest to First Century, and First Century commenced foreclosure proceedings on the Property. On 2 March 2011, First Century purchased the Property at the foreclosure sale with a credit bid of $3.5 million.

Plaintiffs filed the SAC on 26 July 2013, asserting causes of action for breach of contract, breach of the covenant of good faith and fair dealing, breach of oral forbearance agreement, concealment, redemption, wrongful foreclosure, conspiracy, constructive trust, usurious interest, quiet title, cancellation, promissory estoppel, negligence, negligent misrepresentation, fraud, constructive fraud, unfair business practices, negligent infliction of emotional distress (“NIED”), interference with prospective economic advantage, defamation, and aiding and abetting fraud.

Discovery Disputes

I. Plaintiffs’ Motion to Compel the In Camera Review and Production of Documents, to Compel the Production of a Privilege Log, and for a Protective Order

Sometime before 22 February 2014, Plaintiffs served deposition notices on Defendants seeking the production of certain documents, and Defendants produced documents in response.

On 22 February 2014, Defendants’ counsel requested that Plaintiffs’ counsel return 38 emails (“Clawed-Back Documents”) that Defendants produced, arguing that the electronically stored information (“ESI”) was protected from disclosure by the attorney-client privilege and attorney work product doctrine. The parties’ counsel met and conferred, ultimately agreeing that Plaintiffs’ counsel would return the Clawed-Back Documents and Defendants would provide a privilege log.

Plaintiffs’ counsel returned the documents and Defendants produced a privilege log on 28 February 2014. However, it is Plaintiffs’ position that the attorney-client privilege and attorney work product doctrine do not protect the ESI at issue from disclosure.

In January-February 2014, the parties’ counsel stipulated to the terms of a protective order whereby the parties would limit the dissemination of information obtained in pretrial discovery that the responding party properly designated as confidential. This Court entered the stipulated protective order (“Protective Order”) on 21 February 2014.

On 10 March 2014, Plaintiffs’ counsel sent a letter to Defendants’ counsel, designating as confidential a portion of Teri’s deposition transcript wherein she testified about her physical and/or mental health. Defendants’ counsel disagreed with the designation, contending that the Protective Order does not encompass medical or mental health information. The parties’ counsel continued to meet and confer, but their negotiations reached an impasse as to whether the Protective Order encompasses the information in question and whether an order precluding the dissemination of the subject portion of Teri’s deposition transcript is nevertheless warranted.

On 24 March 2014, Plaintiffs’ filed this motion to compel the in camera review of the Clawed-Back Documents, to compel the production of the Clawed-Back Documents, to compel the production of a privilege log, and to limit the dissemination and use of a portion of Teri’s deposition transcript.

Defendants filed their opposing papers on 7 April 2014.

On 11 April 2014, Plaintiffs filed their reply.

II. Defendants’ Motion for an Order Sustaining Objections

Plaintiffs deposed Chen on 14 January 2014, and deposed Liaw on 15 January 2014. In response to certain questions, Chen and Liaw asserted objections and followed their counsel’s instruction not to respond.

On 18 February 2014, Plaintiffs submitted written deposition inquiries to Chen (“Chen Written Questions”) and to Liaw (“Liaw Written Questions”) (collectively, “Written Questions”) that essentially repeated the questions that Chen and Liaw refused to answer during their oral depositions. Defendants served objections to the Written Questions on 7 March 2014.

During meet and confer discussions, the parties’ counsel reached an agreement with respect to Liaw Written Question 4, but were unable to resolve their dispute as to whether Defendants’ objections to the remaining Written Questions have merit.

On 24 March 2014, Defendants filed this motion for an order sustaining their objections to Liaw Written Questions 1-3 and 5-11 and Chen Written Questions 1-3.

Plaintiffs filed papers in opposition on 7 April 2014

On 11 April 2014, Defendants filed their reply.

III. Defendants’ Motion for IMEs of Teri and Vince

Defendants’ counsel contacted Plaintiffs’ counsel on 11 March 2014, asking whether Plaintiffs would stipulate to IMEs of Teri and Vince. Plaintiffs’ counsel refused, and advised that Plaintiffs are “willing” to stipulate that they only seek “garden variety” emotional distress damages.

On 25 March 2014, Defendants filed the motion to conduct the IMEs of Teri and Vince.

On 2 April 2014, Plaintiffs served a “Stipulation to Prevent Mental Examinations” on Defendants, wherein they state that Teri and Vince only seek damages for “garden variety” emotional distress. On 4 April 2014, Plaintiffs served amended responses to EWB’s form interrogatories, wherein they stated that they “will not seek any damages in this case based on any loss of income [attributable to Teri’s and Vince’s emotional distress claims] on and after June 1, 2013.” (Wang Decl., Ex. B.)

Plaintiffs filed their opposition on 7 April 2014.

On 11 April 2014, Defendants filed their reply.

IV. Plaintiffs’ Motions and Defendants’ Application to File Records Under Seal

On 24 March 2014, with their motion to compel, Plaintiffs conditionally lodged Exhibit H—which contains the portion of Teri’s deposition transcript that is at issue in Plaintiffs’ motion for a protective order—under seal. The same day, Plaintiffs filed a motion to seal Exhibit H.

Defendants filed an opposition to Plaintiffs’ motion to file Exhibit H under seal on 7 April 2014.

On 25 March 2014, Defendants conditionally lodged Exhibit I—which also contains the subject portion of Teri’s deposition transcript—under seal. The same day, Defendants submitted an application to file Exhibit I under seal. On 7 April 2014, “out of an abundance of caution,” Plaintiffs filed a motion to seal Exhibit I. Neither Defendants’ application nor Plaintiffs’ motion to file Exhibit I under seal is opposed.

Discussion

I. Plaintiffs’ Motion to Compel the In Camera Review and Production of Documents, to Compel the Production of a Privilege Log, and for a Protective Order

Plaintiffs move to compel the in camera review and production of the Clawed-Back Documents, to compel the production of a privilege log for any document responsive to the deposition notices that was withheld or redacted by Defendants, and for an order limiting the dissemination and use of a portion of Teri’s deposition transcript.

A. In Camera Review and Production of the Clawed-Back Documents

If a party responding to any discovery request produces ESI subject to a privilege or attorney work product doctrine, that party may claw-back the ESI by notifying the receiving party of their claim. (Code Civ. Proc. [“CCP”], § 2031.285, subd. (a).) After receiving notice, the receiving party must sequester the ESI and either return it or bring a motion for an order determining the merits of the claim, in which case the receiving party may “present information to the court conditionally under seal for a determination of the claim.” (Id., subd. (b).)

Pursuant to CCP section 2031.285, Defendants clawed-back the ESI previously produced to Plaintiffs and now refuse to disclose the Clawed-Back Documents, and insist that the Court cannot review them in camera, on the grounds of attorney-client privilege and attorney work product.

Plaintiffs argue that the Clawed-Back Documents are not protected from disclosure by the attorney-client privilege or attorney work product doctrine, and contend that the Court should review the Clawed-Back Documents in camera to evaluate the merits of the Defendants’ objections.

A court may require the in camera review of the information at issue to determine the merits of an asserted work product claim, but not to evaluate the merits of an asserted attorney-client privilege claim. (Evid. Code, § 915, subds. (a)-(b).) Therefore, a court evaluating both the attorney-client privilege and the attorney work product doctrine should, without ordering disclosure or conducting an in camera review, first decide whether the attorney-client privilege applies. (Costco Wholesale Corp. v. Superior Court (2009) 47 Cal.4th 725, 737 [“Costco”].) If the attorney-client privilege is inapplicable, then the court may review the information at issue in camera to decide whether it is protected work product. (Id.)

1. Defendants’ Attorney-Client Privilege Claim

A client has the privilege to refuse to disclose or to prevent another from disclosing a confidential communication between it and its lawyer. (Evid. Code § 954.) The objecting party has the initial burden of showing that the communication falls within the privilege, i.e. that the communication was made “in the course of the lawyer-client relationship.” (Wellpoint Health Networks, Inc. v. Super. Ct. (1997) 59 Cal.App.4th 110, 130, citation omitted.) If it meets this burden, the communication is presumed confidential, and the non-objecting party must show the privilege does not apply or has been waived. (Evid. Code, § 917.)

Defendants describe the Clawed-Back Documents as 38 emails between EWB and its outside counsel and/or in-house counsel. These facts are sufficient to make a prima facie showing that the communications were made in the course of the attorney-client relationship. (See Bank of America N.A. v. Super. Ct. (2013) 212 Cal.App.4th 1076, 1099, citation omitted [communications between an in-house attorney and its corporate client are within the scope of the privilege].) Thus, they are presumed to be confidential.

Since email nos. 1-11 and 16-38 were exchanged between EWB and its in-house counsel at the time when Plaintiffs allege that EWB was negotiating the sale of the Refinance Loan to SyWest, Plaintiffs argue that those emails could have “merely [been] business advice, not legal advice,” and therefore they are not protected by the attorney-client privilege. (Ps’ P&A, at p. 4:22-28.)

Although the attorney-client privilege only applies to legal—as opposed to business—advice (see Chicago Title Ins. Co. v. Super. Ct. (1985) 174 Cal.App.3d 1142, 1151), Plaintiffs’ speculation that these emails contain only business advice is insufficient to rebut the presumption of confidentiality. (See Evid. Code, § 604 [providing that the existence of a presumed fact is only rebutted by evidence of its nonexistence].)

Plaintiffs further argue that the Court should conduct an in camera review of these communications to determine whether they contain business or legal advice. As the Costco court explained, the objecting party, “having the burden of establishing the preliminary fact that the communications were made during the course of an attorney-client relationship, [is] free to request an in camera review of the communications to aid the trial court in making that determination, but the trial court could not order disclosure of he information over the [privilege holder’s] objection.” (Costco, supra, at p. 740.) Therefore, Plaintiffs’ argument is unavailing.

Plaintiffs next assert that the Clawed-Back Documents are not protected from disclosure because they fall within the crime-fraud exception to the attorney-client privilege.

Evidence Code section 956 provides that no attorney-client privilege exists where the attorney’s services were sought to “enable or aid” in the commission of a crime or fraud. For the crime-fraud exception to apply, “the proponent must make a prima facie showing that the services of the lawyer were sought or obtained to enable or aid anyone to commit or plan to commit a crime or fraud,” and the communications at issue are reasonably related to the crime or fraud. (State Farm Fire & Casualty Co. v. Super. Ct. (1997) 54 Cal.App.4th 625, 643.) In this context, a prima facie showing of fraud requires the party to establish “a false representation of a material fact, knowledge of its falsity, intent to deceive and the right to rely.” (BP Alaska Exploration Inc. v. Super. Ct. (1988) 199 Cal.App.3d 1240, 1263 [“BP Alaska”].)

Plaintiffs proffer facts concerning Liaw’s and Chen’s allegedly false statements to Plaintiffs. However, they do not attempt to show a nexus between Liaw’s and Chen’s alleged fraud and the services of EWB’s attorneys, that the Clawed-Back Documents are reasonably related to any crime or fraud, or that Liaw and/or Chen intended to deceive Plaintiffs. Thus, Plaintiffs have not made a prima facie showing to establish that the crime-fraud exception applies.

The Clawed-Back Documents are therefore protected from disclosure by the attorney-client privilege, and the Court cannot compel their disclosure or review them in camera. (See Costco, supra, at p. 737.)

2. Defendants’ Attorney Work Product Doctrine Claim

Even assuming arguendo that the attorney-client privilege did not protect the Clawed-Back Documents from disclosure, Defendants argue that these emails would be protected by the attorney work product doctrine.

An attorney has an absolute protection in his or her “impressions, conclusions, opinions, or legal research or theories,” and a qualified protection for all other work product. (CCP, § 2018.030.) The party asserting the attorney work product doctrine has the initial burden of making a prima facie showing that the discovery sought is subject to the protection. (BP Alaska, supra, at p. 1252, citation omitted.)

Defendants maintain that the Clawed-Back Documents are protected by the attorney work product doctrine because each contains EWB’s counsels’ mental impressions, opinions, or conclusions. Plaintiffs, on the other hand, assert that email nos. 1, 3-4, 6-7, 9, 11-12, 14-16, 18-26, 28-33, 35-36, and 38 were sent by non-attorneys, and thus, those emails are not protected by the attorney work product doctrine.

The attorney work product statute “does not restrict work product to only those writings in the attorney’s possession,” but rather it applies to information disclosed to clients in confidence. (BP Alaska, supra, at pp. 1253-1254.) Here, email nos. 1, 3-4, 6-7, 9, 11-12, 14-16, 18-26, 28-33, 35-36, and 38 are authored by the client (i.e. EWB’s employees and agents) and sent to the attorney(s) whose work product is purportedly contained therein as part of a confidential email exchange between the attorney and client. Since the disclosures occurred in confidence between the clients and attorneys, the emails authored by the clients are within the scope of the work product doctrine. Accordingly, Defendants have made a prima facie showing that the Clawed-Back Documents are protected attorney work product.

Therefore, the attorney work product doctrine also protects the Clawed-Back Documents from disclosure.

Since the Court was able to evaluate the merits of the claim without reviewing the documents themselves, there is no need for an in camera review of the Clawed-Back Documents. (See Evid. Code, § 915, subd. (b).) In any event, the Court would not be able to review them in camera because, as discussed in detail above, the Clawed-Back Documents are protected by the attorney-client privilege. (See Costo, supra, at p. 737.)

3. Conclusion

Plaintiffs’ motion to compel the in camera review and production of the Clawed-Back Documents is DENIED.

B. Production of a Privilege Log

Plaintiffs request an order compelling Defendants to produce a privilege log identifying each document responsive to the deposition notices that they withheld or redacted on the basis of privilege because “EWB has produced about 32,000 pages of documents, likely hundreds if not thousands of which contain redactions,” and “[i]t is unclear to Plaintiffs whether EWB has withheld any documents in entirety.” (Ps’ P&A, at p. 10:11-13.)

Plaintiffs cite CCP section 2031.240, subdivision (c) as authorizing such an order. That provision merely describes the information that a party responding to a request for production of documents—not a deposition notice—must include in an objection on the basis of privilege. (See CCP, § 2031.240, subd. (c).) CCP section 2031.240 does not provide an independent legal basis for a motion to compel a responding party to provide a privilege log.

As Defendants persuasively argue, Plaintiffs present no legal basis for the Court to compel them to produce a privilege log in response to their deposition notices. Even assuming arguendo that the legal basis authorizing a motion to compel further responses to requests for production of documents—i.e. CCP section 2031.310—also authorized a motion to compel the production of a privilege log in response to a deposition notice, Plaintiffs have not complied with the procedural requirements of CCP section 2031.310. (See CCP, § 2031.310, subd. (b) [requiring a meet and confer declaration and a showing of good cause for the discovery sought]; see also CRC, rule 3.1345(a) [requiring a separate statement for a motion to compel further responses to requests for production of documents].)

Accordingly, Plaintiffs’ motion to compel the production of a privilege log is DENIED.

C. Protective Order Limiting the Dissemination and Use of Part of Teri’s Deposition Transcript

Plaintiffs seek an order limiting Defendants’ dissemination and use of part of Teri’s deposition transcript. Plaintiffs contend that such an order is warranted because the portion of the deposition transcript at issue is “confidential information” pursuant to the terms of the Protective Order.

Alternatively, Plaintiffs argue that Teri’s right to privacy warrants another protective order that directs Defendants to treat the subject portion of Teri’s deposition transcript as “confidential information” pursuant to the terms of the Protective Order.

The portion of Teri’s deposition transcript at issue contains her medical and psychiatric information. However, the Protective Order defines “confidential information” as trade secrets, confidential business information, or financial information. (Protective Order, at ¶ 2.) Since the Protective Order does not encompass medical information, it does not require Defendants to limit the dissemination and use of Teri’s deposition transcript. That being said, the Protective Order does not preclude a party from seeking a separate or subsequent protective order. (Id., ¶ 11.)

1. Legal Standard

Before, during, or after a deposition, a deponent may promptly move for a protective order (CCP, § 2025.420, subd. (a)), including an order to limit the dissemination of a deposition transcript (see CCP, § 2025.570, subd. (c)). For good cause shown, the court may make any order that justice requires to protect the deponent from unwarranted annoyance, embarrassment, or oppression, or undue burden and expense. (CCP, § 2025.420, subd. (b).) The issuance and formulation of protective orders are to a large extent discretionary. (See Raymond Handling Concepts Corp. v. Super. Ct. (1995) 39 Cal.App.4th 584, 587-588.) However, the court must balance the interests of the public and the parties by requiring the party seeking to restrict discovery or dissemination of discovered information to demonstrate “good cause” for the restriction. (See CCP, § 2025.420, subd. (b), Westinghouse Electric Corp. v. Newman & Holtzinger (1995) 39 Cal.App.4th 1194, 1208-1209.)

2. Analysis

Plaintiffs argue that an order limiting the dissemination and use of the subject portion of Teri’s deposition transcript is necessary to protect Teri’s privacy in her physical and mental health information.

An individual has a legally recognized privacy interest in his or her medical and mental health information. (John B. v. Super. Ct. (2006) 38 Cal.4th 1177, 1198 [medical records]; Pettus v. Cole (1996) 49 Cal.App.4th 402, 440 [medical and psychiatric histories].) Moreover, an individual has an interest in precluding the dissemination or misuse of sensitive and confidential information. (Hill v. National Collegiate Athletic Ass’n (1994) 7 C4th 1, 35 [“Hill”].)

Since it is undisputed that the portion of Teri’s deposition transcript at issue encompasses her medical and psychiatric information, Teri’s right to privacy is implicated.

The right to privacy is not absolute. (Vinson v. Super. Ct. (1987) 43 Cal.3d 833, 842 [“Vinson”].) Where a privacy interest is shown, it “must be measured against other competing or countervailing interests in a ‘balancing test.’” (Pioneer Electronics, Inc. v. Super. Ct. (2007) 40 Cal.4th 360, 371, quoting Hill, supra, at p. 37.) “Protective measures, safeguards and other alternatives may minimize the privacy intrusion.” (Id.) “For example, if intrusion is limited and confidential information is carefully shielded from disclosure except to those who have a legitimate need to know, privacy concerns are assuaged.” (Id., quoting Hill, supra, at p. 38.)

Here, Plaintiffs have shown that Teri has a legitimate privacy interest in limiting the dissemination and use of a portion of her deposition transcript, and Defendants do not identify a countervailing interest in allowing them to disclose and use Teri’s deposition transcript without any limitation. Instead, Defendants insist that Teri somehow waived her right to medical privacy by virtue of filing this lawsuit, and also insists that they should not be compelled to limit the dissemination and use of Teri’s deposition transcript because her testimony is directly relevant to Plaintiffs’ emotional distress claim. These arguments are not well-taken for two reasons.

First, Defendants conflate the physician/psychotherapist-patient privileges and the right to privacy, which are two separate and distinct objections. (See San Diego Trolley v. Superior Court (2001) 87 Cal.App.4th 1083, 1092 [where a patient waives the physician/psychotherapist-patient privileges, “a patient retains the more general right to privacy”].) In connection with an objection based on the physician/psychotherapist-patient privileges, an exception exists for communications that are directly relevant to an issue in a case tendered by the patient. (Evid. Code, §§ 996, subd. (a), and 1016, subd. (a).) This exception does not apply to objections based on privacy.

Second, in connection with a privacy objection, the “direct relevance” analysis is only applicable after it is shown that the discovery (as opposed to the dissemination and use) of private information would constitute a serious invasion of an individual’s reasonable expectation of privacy. (Puerto v. Super. Ct. (Wild Oats) (2008) 158 Cal.App.4th 1242, 1249-1250, citation omitted.) Here, Defendants have already discovered the information at issue, and therefore the direct relevance standard is inapplicable.

Accordingly, an order requiring Defendants to limit the dissemination and use of the subject portion of Teri’s deposition transcript in conformity with the terms of the Protective Order is warranted.

3. Conclusion

Plaintiffs’ motion for a protective order limiting the dissemination and use of portions of Teri’s deposition transcript is GRANTED.

II. Defendants’ Motion for an Order Sustaining Objections to Written Questions and Plaintiffs’ Request for an Award of Monetary Sanctions

Defendants move for an order sustaining their objections to Chen Written Questions 1-3 and Liaw Written Questions 1-3 and 5-11.

Plaintiffs oppose the motion and request an award of monetary sanctions against Defendants.

A. Defendants’ Motion

1. Legal Standard

In response to written deposition questions, a deponent may only object based on (1) the form of the question and (2) privilege or attorney work product. (CCP, §§ 2028.040 and 2028.050.) A party objecting to the form of a written deposition question shall serve a specific written objection to that question and promptly move for an order sustaining the objection. (CCP, § 2028.040, subds. (a) and (b).) “Questions subject to objection as to form include leading questions . . . and argumentative, repetitive, uncertain or unintelligible, omnibus or compound questions and those assuming facts not in evidence.” (Chavez v. Zapata Ocean Resources, Inc. (1984) 155 Cal. App. 3d 115, 124, citations omitted.) The party objecting to deposition questions bears the burden of justifying its objections. (See Fairmont Ins. Co. v. Super. Ct. (2000) 22 Cal.4th 245, 255.)

2. Analysis

In response to each of the three Chen Written Questions, Defendants asserted objections on the grounds of calls for a legal conclusion, “unfair,” and vague.

In response to the Liaw Written Questions, Defendants objected on the grounds that questions 1-3, 5-6, and 11 are “improper and unfair for deposition,” questions 7-11 are irrelevant and harassing, questions 1-3 call for a narrative, question 1 is unduly burdensome and oppressive, questions 3 and 5 are compound, and question 11 calls for an expert and/or legal opinion and for speculation.

Of these objections, CCP sections 2028.040 and 2028.050 only authorize objections on the grounds of vagueness and compound. Since “unfair” or “improper or unfair for deposition,” relevance, harassment, calls for a narrative, undue burden and oppression, calls for a legal opinion, calls for an expert opinion, and calls for speculation are not appropriate grounds for objections to written deposition questions, those objections are overruled.

a. Vagueness Objection (Chen Written Questions 1-3)

Defendants contend that the Chen Written Questions are impermissibly vague because they are not limited to a certain time period.

A vagueness objection to a discovery written discovery request will only be sustained where the request is unintelligible. (Deyo v. Kilbourne (1978) 84 Cal.App.3d 771, 783.) “A party may not deliberately misconstrue a question for the purpose of supplying an evasive answer.” (Id.)

Contrary to Defendants’ assertion, the Chen Written Questions are each unequivocally limited to the period from November 2008 to February 2009. Moreover, the questions are each intelligible. Accordingly, Defendants’ argument lacks merit.

Defendants further maintain that “‘[i]f there is doubt as to what the examiner’s question means, or if the question is too complicated for the witness to understand, it is objectionable under’ Evidence Code [section] 765.” (Ds’ P&A, at p. 9:8-10, quoting Haning, Flahavan, Kelly & Wright, California Practice Guide: Personal Injury (Rutter Group 2014) at 9:318.) However, Evidence Code section 765 applies only to questions asked of a witness during trial and is immaterial to the determination of the merits of Defendants’ vagueness objection to written deposition inquiries. Thus, Defendants’ argument is not well-taken.

Defendants’ objection to the Chen Written Questions on the ground of vagueness is therefore overruled.

b. Compound Objection (Liaw Written Questions 3 & 5)

Defendants argue that Liaw Written Questions 3 and 5 are impermissibly compound because each encompasses “separate and distinct subjects.” (Ds’ P&A, at p. 13.)

While a written discovery request must not be a “compound, conjunctive, or disjunctive question,” the use of subparts is not “per se abusive” and will be tolerated to the extent a written discovery request embraces a single subject. (See Clement v. Alegra (2009) 177 Cal.App.4th 1277, 1287-1289, and 1291; CCP, §§ 2030.060, subd. (f), and 2033.060, subd. (f).)

Liaw Written Questions 3 and 5 each quote a passage from a letter introduced as Exhibit 163 at Liaw’s oral deposition and then asks “[w]hat in this sentence is not true?”

Defendants insist that Liaw Written Question 3 encompasses more than one subject because the passage to which it refers encompasses more than one fact, i.e. “whether Mr. Fong could stop alleged abuses, bullying and harassment, and whether Syufy took Plaintiffs’ property unjustly.” (Ds’ P&A, at p. 13:20-22.) Likewise, they argue that Liaw Written Question 5 encompasses two separate subjects because the quoted passage addresses Liaw’s “role in this lawsuit, and Plaintiffs’ motives for suing her.” (Id., at p. 13:22-23.) Defendants’ arguments are unavailing because the questions each embrace a single subject: which facts in the quoted passage are not true.

Accordingly, Defendants’ compound objection is overruled.

3. Conclusion

Defendants’ motion for an order sustaining objections to the Written Questions is DENIED.

B. Plaintiffs’ Request for Monetary Sanctions

Plaintiffs make a code-compliant request for monetary sanctions against Defendants in the amount of $2,750.

“The court shall impose a monetary sanction . . . against any party, person, or attorney who unsuccessfully makes or opposes a motion to sustain an objection, unless it finds that the one subject to the sanction acted with substantial justification or that other circumstances make the imposition of the sanction unjust.” (CCP, § 2028.040, subd. (c).)

Here, Defendants’ motion was unsuccessful, and since most of their objections were not to the form of the question and those objections that were based on the form of the question lack merit, they did not act with substantial justification. The Court finds no other circumstances exist that would make the imposition of the sanction unjust, and therefore, an award of monetary sanctions is warranted.

A court may award monetary sanctions for reasonable expenses, including attorney’s fees, incurred as a result of the sanctionable conduct. (CCP, § 2023.030, italics added.) A court cannot award sanctions for anticipated expenses because such expenses have not yet been incurred. (Tucker v. Pacific Bell Mobile Services (2010) 186 Cal.App.4th 1548, 1551.)

In the declaration submitted with the moving papers, Plaintiffs’ counsel declares to have spent 10 hours preparing the opposing papers, meeting and conferring with Defendants’ counsel, and preparing for the hearing on this motion at a rate of $275 per hour. (Wang Decl., at ¶ 6.)

Since the meet and confer efforts occurred before Defendants filed this motion, Plaintiffs did not incur attorney’s fees in connection with their counsel’s meet and confer efforts as a result of Defendants’ motion. Therefore, counsel’s time spent meeting and conferring is not compensable.

With respect to the time spent preparing the motion, the Court notes that counsel declares to have already spent time preparing for the hearing. Given that counsel already spent time preparing for the hearing—as opposed to merely anticipating spending time preparing for the hearing—the Court finds that those attorney’s fees were incurred as a result of Defendants’ sanctionable conduct.

Although counsel’s hourly rate is reasonable, counsel’s declaration does not distinguish the non-compensable time spent meeting and conferring from the compensable time spent preparing the opposing papers and for the hearing on this matter. That being said, the Court finds that 4 hours would be a reasonable amount of time for counsel to have spent preparing the opposing papers and for the hearing.

Accordingly, Plaintiffs’ request for an award of monetary sanctions against Defendants is GRANTED IN PART in the amount of $1,100.

III. Defendants’ Motion for IMEs of Teri and Vince

Defendants bring a motion for the IMEs of Teri and Vince.

Plaintiffs oppose the motion on the ground that they Teri and Vince seek “garden variety” emotional distress damages for their past mental anguish.

Discovery may be obtained by means of a mental examination of a party in any action in which the mental condition of that party is in controversy. (CCP, § 2032.020, subd. (a).) A party seeking discovery by mental examination must obtain leave of court, and the court may only order a mental examination for good cause shown. (CCP, §§ 2032.310, subd. (a) and 2032.320, subd. (a).) “Good cause” requires the moving party to demonstrate the relevance of the proposed IME, i.e. that the examination is reasonably calculated to lead to the discovery of admissible evidence, with a fact-specific showing that (1) the plaintiff alleges severe—as opposed to “garden variety”—emotional distress, and (2) the plaintiff is currently suffering from severe emotional distress. (Vinson v. Super. Ct. (1987) 43 Cal. 3d 833, 840 [“Vinson”]; see also Doyle v. Super. Ct. (1996) 50 Cal.App.4th 1878, 1886 [“Doyle”].)

A. Severity of Plaintiffs’ Alleged Emotional Distress

Only claims of severe emotional distress—as opposed to the garden variety emotional distress that typically accompanies physical injury—warrant an IME. (Vinson, supra, at pp. 839-840; see also Davis v. Super. Ct. (1992) 7 Cal.App.4th 1008, 1016 [“Davis”] [distinguishing “garden variety” from “severe” emotional distress].)

Defendants argue that they have good cause for the IMEs of Teri and Vince because they assert a claim for NIED and seek damages for severe emotional distress. This argument is well-taken. Teri and Vince allege specific averments that place their mental health at issue, and also allege that their emotional distress was “great” and “severe.” (SAC, ¶¶ 170, 192-193, & 195.) These facts are sufficient to show that their claim is for severe emotional distress.

Plaintiffs insist that, since they submitted a stipulation wherein Teri and Vince agree to limit their claims to mere garden variety emotional distress, the Court “shall not” order Teri and Vince to appear for an IME unless Defendants show “exceptional circumstances.” (Ps’ Opp’n, at p. 5:1-11, citing CCP, § 2032.320, subds. (b)-(c).)

CCP section 2032.320, subdivisions (b)-(c) provides that, where a party seeks recovery for “personal injuries,” if that party submits a stipulation that states (1) no claim for emotional distress is being made beyond the garden variety emotional distress “that usually associated with the physical injuries claimed,” and (2) no expert testimony regarding the garden variety emotional distress will be presented at trial, then the court shall not order the IME of that party “except on a showing of exceptional circumstances.” (Italics added.)

Plaintiffs concede that Teri and Vince do not allege any “physical injuries,” but nevertheless contend that their stipulation precludes Defendants from conducting IMEs of Teri and Vince. Relying on Vinson, Plaintiffs state that “the rationale underlying the statute applies with equal force to all cases involving claims of emotional distress, even if there is no physical injury alleged.” (Ps’ Opp’n, at p. 6:4-6.) However, the Vinson court did not address the stipulation exception, and thus, it does not support Plaintiffs’ position. (See Vinson, supra, at p. 840.)

Moreover, Teri and Vince assert a cause of action for NIED, and unequivocally seek damages for “severe” and “great” emotional distress. (SAC, ¶¶ 170, 192-193, & 195.) Contrary to Plaintiffs’ stipulation, Teri and Vince clearly have not limited their claims to garden variety emotional distress. Therefore, the stipulation submitted by Plaintiffs is immaterial.

Accordingly, Defendants have shown that Teri’s and Vince’s alleged severe—as opposed to garden variety—emotional distress.

B. Plaintiffs’ Current Mental Condition

An IME may only be ordered if the alleged emotional distress is current. (Doyle, supra, at p. 1886.) The fact that a plaintiff alleges to have suffered severe emotional distress in the past does not show good cause for an IME. (Id.)

Defendants assert that since Teri and Vince seek damages for severe emotional distress, it necessarily follows that their mental anguish is current. Defendants cite on Wong v. Tai Jing (2010) 189 Cal.App.4th 1354, 1377 (“Wong”) for the proposition that severe emotional distress is “lasting and enduring.” (Ds’ P&A, at p. 5:15-17, italics in original.) Based on this definition, Defendants somehow conclude that a “lasting and enduring emotional distress [claim] necessarily involves the current mental condition of the person making that claim.” (Id., at p. 5:17-18.) This argument is not well-taken. No legal authority supports the proposition that all severe emotional distress as alleged in a complaint is necessarily the current condition of the party asserting such claims.

Next, Defendants argue that the holding in Doyle is inapplicable to this case because in that case, the plaintiff amended her complaint to specifically state that her emotional distress was not continuing or current.

However, in Doyle, the plaintiff initially alleged that she “continues to suffer” severe emotional distress, then amended her pleading to replace her allegation of continuing emotional distress with an allegation of past suffering only. (Doyle, supra, at pp. 1880-1881.) The court found the plaintiff’s amendment to be “significant” because in the original pleading, her alleged emotional distress was “ongoing,” but after the amendment, her alleged emotional distress “was not ongoing.” (Id, at p. 1885, fn. 2.)

In contrast, the SAC does not allege ongoing emotional distress. Rather, in connection with their fraud claim, Teri and Vince allege to have “suffered great emotional distress,” and with respect to the NIED claim, they allege that Defendants “caused [them] severe emotional distress” such that Teri and Vince “have been humiliated, embarrassed and caused to suffer great mental and emotional distress, and has [sic] been generally damaged,” and “have suffered great anxiety, embarrassment, anger, loss of enjoyment of life, and severe emotional distress.” (SAC, ¶¶ 170, 192-193 & 195, italics added.) Since Teri’s and Vince’s allegations in the SAC do not allege any ongoing or current emotional harm, Defendants’ argument that Doyle does not apply is unavailing.

Lastly, Defendants insist that since Vince and Teri responded to prior discovery by stating that they experienced symptoms of emotional distress attributable to Defendants’ conduct between 2009 and 2011, it necessarily follows that they are currently suffering from emotional distress. This argument is not well-taken because it does not explain how symptoms that purportedly subsided in 2011 would be reflected by Teri’s and Vince’s emotional state in 2014. (See Doyle, supra, at p. 1886 [plaintiff’s current mental state is not relevant to allegations of past emotional distress].)

Defendants therefore have not shown that Teri’s and Vince’s emotional distress is current. Thus, they have not shown good cause for conducting IMEs.

C. Conclusion

Defendants’ motion to compel the IME of Teri and Vince is DENIED.

IV. Plaintiffs’ Motions and Defendants’ Application to File Records Under Seal

Plaintiffs move for an order to file Exhibit H and Exhibit I under seal. Defendants additionally submit an application to file Exhibit I under seal.

Plaintiffs argue that an order sealing Exhibit H and Exhibit I from the Court’s record is authorized by CRC, rules 2.550 and 2.551.

Defendants assert that since Plaintiffs designated a portion of Teri’s deposition transcript as “confidential information,” the terms of the Protective Order require them to submit an application to file Exhibit I—which is a copy of that portion of Teri’s deposition transcript—under seal. The Protective Order states that to use any information designated as confidential in court, the party submitting the information must conditionally file it under seal and bring a motion to file it under seal pursuant to CRC, rule 2.551. (Protective Order, ¶¶ 6 & 12-13.)

CRC, rule 2.551 sets forth the procedures for filing records under seal. CRC, rule 2.550(d) provides that to grant leave to file records under seal, the court must make the following express factual findings: (1) an overriding interest overcomes the public’s presumptive right of access to court records, (2) that interest supports sealing the records, (3) a substantial probability exists that the overriding interest will be prejudiced if the records are not sealed, (4) the proposed sealing is narrowly tailored, and (5) no less restrictive means exist to achieve the overriding interest.

These criteria do not apply, however, to “discovery motions and records filed or lodged in connection with discovery motions or proceedings” (CRC, rule 2.550(a)(3)), and by the terms of the Protective Order, the parties stipulated to follow the procedures set forth in CRC, rule 2.551, but not the criteria set forth in CRC, rule 2.550(d). Nonetheless, even in discovery proceedings, a party moving for leave to file records under seal must identify the specific information claimed to be entitled to confidentiality and the nature of the harm threatened by disclosure. (See H.B. Fuller Co. v. Doe (2007) 151 Cal.App.4th 879, 894.)

A. Plaintiffs’ Motions to Seal Exhibit H and Exhibit I

Plaintiffs identify the specific information which they claim should be treated as confidential as the portion of Teri’s deposition transcript that reflects her testimony regarding her medical and mental health condition. It is undisputed that Exhibit H and Exhibit I each contain a copy of that portion of Teri’s deposition transcript.

In addition, Plaintiffs describe the nature of the harm threatened by disclosure of Exhibit H and/or Exhibit I to be an invasion of Teri’s right to privacy in her medical information.

As discussed above, the dissemination of the portion of Teri’s deposition transcript that is in Exhibit H and Exhibit I would indeed constitute an invasion of her privacy right. Disclosure of the contents of Exhibit H and Exhibit I would therefore harm Teri’s constitutional privacy interest.

Accordingly, Plaintiffs’ motions to file Exhibit H and Exhibit I under seal are GRANTED.

B. Defendants’ Application to File Exhibit I Under Seal

Since Plaintiffs’ motion to seal Exhibit I is successful, Defendants’ application to seal Exhibit I is MOOT.

Conclusion

Plaintiffs’ motion to compel the in camera review and production of the Clawed-Back Documents, to compel the production of a privilege log, and for an order limiting Defendants’ dissemination and use of a portion of Teri’s deposition transcript is GRANTED IN PART and DENIED IN PART. The motion is GRANTED to the extent Plaintiffs seek an order limiting Defendants’ dissemination and use of the subject portion of Teri’s deposition transcript. Accordingly, Defendants shall maintain the confidentiality of the portion of Teri’s deposition transcript at issue and limit the dissemination and use of that portion of Teri’s deposition transcript in compliance with the terms set forth in paragraphs 3-14 of the Protective Order. The motion is DENIED to the extent Plaintiffs seek an order compelling the in camera review and production of the Clawed-Back Documents and the production of a privilege log.

Defendants’ motion for an order sustaining their objections to the Written Deposition Questions is DENIED. Accordingly, within 20 days of the date of the filing of this Order, at a mutually agreeable location and time, Liaw shall appear for a deposition and answer the questions set forth in the Liaw Written Questions, and Chen shall appear for a deposition and answer the questions set forth in the Chen Written Questions.

Plaintiffs’ request for an award of monetary sanctions against Defendants in connection with Defendants’ motion to sustain objections is GRANTED IN PART in the amount of $1,100. Accordingly, within 20 days of the date of the filing of this Order, Defendants shall pay $1,100 to Plaintiffs’ counsel.

Defendants’ motion to conduct IMEs of Teri and Vince is DENIED.

Plaintiffs’ motions to file Exhibit H and Exhibit I under seal are GRANTED.

Defendants’ application to file Exhibit I under seal is MOOT.

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